Committee for the Abolition of Illegitimate Debt

Joffé, one of the people in charge of the Soviet delegation, phoned the Germans at 1 a.m. on Easter Sunday, 16 April 1922, to suggest they should meet at once and try to reach a bilateral agreement. The biographer of the then German minister for economy, Walther Rathenau, writes that the members of the German delegation met in their pyjamas in Rathenau’s hotel room to decide whether they would accept the Soviet invitation. They did, and sixteen hours later, on Sunday 16 April 1922 at 5 p.m., the Treaty of Rapallo was signed between Germany and Soviet Russia [1]. The treaty included mutual waiving of financial claims, including German compensation after Soviet nationalisations “on condition that the government of the Russian Socialist Federal Soviet Republic does not satisfy claims for compensation of a similar nature made by a third Party” [2]. It is important to note that Soviet Russia remained fully consistent with the position that the Soviet government had adopted in its peace proposal in the very wake of the revolution: peace without either annexation or compensation. As we know, in March 1918 the German Empire had imposed drastic conditions on Russia with the Treaty of Brest-Litovsk, as it annexed Russian territories and demanded a heavy war ransom. In June 1919 that treaty had been cancelled by the Treaty of Versailles, in which Western powers amputated the German Republic of large stretches of its territories and demanded heavy compensations. In the Treaty of Rapallo, Soviet Russia signed a peace agreement that included mutual waiving of compensation while article 116 of the Treaty of Versailles granted Russia a right to financial compensation from Germany. This step taken by Soviet Russia was also consistent with the treaties it had signed with the Baltic Republics and Poland in 1920-1921.

Another provision in the Treaty of Rapallo said that Germany would help to boost trade between the two countries.

In a nutshell, the Treaty of Rapallo, signed on the suggestion of the Soviet delegation, was a strong response to the dominant and aggressive behaviour of the Western powers.

Next, the Soviet delegation took the time to communicate its official answer to the Western powers in response to the demands they had formulated on 15 April.

Translated by Christine Pagnoulle and Vicki Briault (CADTM).

Front page of the French daily, “Le Petit Journal”. Headline: Mr Lloyd George urges Chancellor Wirth to abandon Treaty or Conference

Part 1: Russia: Repudiation of debt at the heart of the revolutions of 1905 and 1917
Part 2: From Tsarist Russia to the 1917 revolution and the repudiation of debt
Part 3: The Russian Revolution, Debt Repudiation, War and Peace
Part 4: The Russian Revolution, Peoples’ Right to Self-determination, and Debt Repudiation
Part 5: The French press in the pay of the Tsar
Part 6: Russian bonds never die
Part 7: Diplomatic manoeuvers around Russian debt repudiation
Part 8: In 1922 creditor powers again attempt to subjugate the Soviets
Part 9: The Soviet counter-attack: the Treaty of Rapallo, 1922
Part 10: Genoa (1922): proposals and, counter-proposals on the Tsarist debt
Part 11: Debt— Lloyd George blames the Soviets
Part 12: Reasserting debt repudiation ends with success